Pay yourself first with auto bill pay system and method

ABSTRACT

The invention encourages users to not only pay themselves first, but to pay themselves first in the largest amounts possible, even if they are not able to fully pay outstanding debts. In general, the system obtains information related to the user&#39;s income, income sources, user&#39;s debts (e.g., bills) and user&#39;s goals. The system then provides recommendations related to the prioritization of paying certain bills and the amount to pay for each bill based upon, for example, savings goals, minimum amounts due, due dates and available income. The system and/or the user may then determine a payment hierarchy which includes transferring funds to the user&#39;s savings account prior to paying all or a portion of certain bills. The system also transfers instructions related to payment of user debts to an automatic bill payment system to facilitate payment of the user debts.

CROSS REFERENCE TO RELATED APPLICATIONS

This application claims priority to, and the benefit of, U.S.Provisional Application Ser. No. 60/542,716, entitled “PAY YOURSELFFIRST SYSTEM AND METHOD,” filed Feb. 6, 2004, and U.S. ProvisionalApplication Ser. No. 60/552,857, entitled “IMPROVED PAY YOURSELF FIRSTSYSTEM AND METHOD,” filed Mar. 11, 2004, which are both herebyincorporated by reference in their entirety.

FIELD OF INVENTION

This invention relates generally to money management, and moreparticularly, to the hierarchical distribution of income among a user'ssavings account and a user's debts, wherein the debt payments arefacilitated with an automatic bill payment system.

BACKGROUND OF INVENTION

An increasing number of people have difficulty managing their income anddebts as evidenced by an increase in bankruptcies, home foreclosures,excessive credit card balances, and other money mismanagement practices.Additionally, a larger number of people tend to live paycheck topaycheck, and unfortunately, an increasing number of consumer servicestake advantage of consumer's money mismanagement practices. For example,an increased number of financial products and services exist which putpeople in larger debt or require people to pay more bills including, forexample, check cashing centers with large fees, home equity loans,interest free or payment free purchases for a certain number of months,cash advance offers, pawn shops, short-term cash loans with largeinterest rates, debt consolidation loans and early partial monies basedupon the user assigning tax rebates.

Furthermore, due in part to the increased use of charge cards, paymentplans, layaway plans, periodic payment plans, loans, mortgages and otherservices which are billed periodically, people are typically forced tomanage numerous bills and other debts each month. Upon receiving a bill,many people pay the bill immediately or as soon as possible to avoidmissing a payment and to avoid any late fees. Many people also usuallypay bills immediately upon receipt in fear that their credit rating maybe affected, fear that they may be sued, fear of late fees,discontinuance of service, a dislike of owing money, and/or a dislike ofunresolved bills piled up in their homes. Moreover, many people willoften use all of their income to pay bills first, spend all of theirdiscretionary money, then attempt to save the remainder of the income,which is often little or no money. As such, many people are unable tosave a sufficient amount of money. Accordingly, a system is needed toencourage and increase savings prior to paying all or a portion ofdebts, while reducing such bill payment fears and at least partiallydiscouraging the attitude to pay the entire amount of bills or debtsfirst.

Moreover, while automatic bill payment systems exist, the automatic billpayment systems typically require consumer input of a particular amountto be paid and a particular bill to be paid. However, the automatic billpayment systems do not include any hardware or software to consider userincome, user income sources and user savings goals when determining billpayments. Additionally, because third party companies operate theautomatic bill payment systems, the automatic bill payment systemscannot be sufficiently customized or altered to provide such features.Accordingly, a technical problem exists wherein the automatic billpayment systems lack certain needed features. As such, a need exists todevelop complex hardware and software to analyze income sources andsavings goals before transferring the consumer funds to an automaticbill payment system.

SUMMARY OF INVENTION

The present invention encourages users to not only pay themselves first,but to pay themselves first in the largest amounts possible, even ifthey are not able to fully pay outstanding debts. In general, the systemobtains information related to the user's income, income sources, user'sdebts (e.g., bills) and user's goals. The system then providesrecommendations related to the prioritization of paying certain billsand the amount to pay for each bill based upon, for example, savingsgoals, minimum amounts due, due dates and available income. The systemand/or the user may then determine a payment hierarchy which includestransferring funds to the user's savings account prior to paying all ora portion of certain bills.

More particularly, the invention allocates income to a user savingsaccount and to user debts by receiving user financial information,wherein the financial information includes, for example, user incomeinformation related to user income, user income source informationrelated to user income sources, user debt information related to userdebts and user goal information related to user goals; providing atleast one recommendation, wherein the recommendation includes, forexample, suggestions for minimizing user debt payments and maximizinguser savings; establishing a payment hierarchy based at least in part onthe recommendation, wherein the payment hierarchy includes at least aportion of a payment allocated to the user savings account and a portionallocated to the user debts; acquiring user income; transferring userincome, based at least in part upon the payment hierarchy, to at leastone of user savings account and user debts; and, transferringinstructions related to payment of user debts to an automatic billpayment system.

BRIEF DESCRIPTION OF DRAWINGS

The invention will hereinafter be described in conjunction with theappended drawing figures, wherein like numerals denote like elements,and:

FIG. 1 is a block diagram showing an exemplary embodiment of a system inaccordance with the present invention; and,

FIG. 2 is a flow chart showing an exemplary embodiment of a method forimplementing the present invention.

DETAILED DESCRIPTION

The detailed description of exemplary embodiments of the inventionherein makes reference to the accompanying drawings, which show theexemplary embodiment by way of illustration and its best mode. Whilethese exemplary embodiments are described in sufficient detail to enablethose skilled in the art to practice the invention, it should beunderstood that other embodiments may be realized and that logical andmechanical changes may be made without departing from the spirit andscope of the invention. Thus, the detailed description herein ispresented for purposes of illustration only and not of limitation. Forexample, the steps recited in any of the method or process descriptionsmay be executed in any order and are not limited to the order presented.

In general, the invention includes a system and method which facilitatesthe transfer of all or any portion of user income to a user account 20and user savings account 23 based upon a hierarchical based or rulesbased system. The invention also allocates and transfers a portion ofthe user income to other accounts (e.g., payee bills or debts) basedupon other hierarchies and rules, wherein the host 5 may transfer aportion of the user income from user account 20 to a user savingsaccount 23 (“pay yourself”) first before paying all or a certain portionof the user debts. In one embodiment, the invention includes complexhardware and software to analyze income sources and savings goals beforetransferring the consumer income to an automatic bill payment system. Aswill be appreciated by one of ordinary skill in the art, the presentinvention may be embodied as a customization of an existing system, anadd-on product, upgraded software, a stand alone system, a distributedsystem, a method, a data processing system, a device for dataprocessing, and/or a computer program product. Accordingly, the presentinvention may take the form of an entirely software embodiment, anentirely hardware embodiment, or an embodiment combining aspects of bothsoftware and hardware. Furthermore, the present invention may take theform of a computer program product on a computer-readable storage mediumhaving computer-readable program code means embodied in the storagemedium. Any suitable computer-readable storage medium may be utilized,including hard disks, CD-ROM, optical storage devices, magnetic storagedevices, and/or the like.

The user income, as used herein, may include any monetary ornon-monetary income, asset or benefit related to the user, wherein theincome may be obtained from an income source of the user (e.g.,employer) or any other third party. The user income may includepaycheck, salary, bonuses, commissions, purchase rebate, tax rebates,property, goods, social security, welfare, alimony, child support,rental income, securities-related income, gambling winnings, credits,loyalty points, reward points, coupons, entry passes and/or the like.

User debts, as used herein, include any monetary or non-monetaryliability of the user or any other third party (e.g., user may beobligated or desire to pay off the debt of a relative, company orassociate). The debts may be related to bills (e.g., utilities, cabletelevision, phone, etc), car payments, loans, mortgages, purchases,voluntary payments (e.g., charitable or religious donations), alimony,child support, payment plans, lines of credit, financial losses,gambling losses, responsibilities and/or the like.

An exemplary system 1 according to one embodiment, and as set forth inFIG. 1, may include one or more host 5, user account 20, user savingsaccount 23, user interface 25, income source 30 and payee 40. The systemmay also include or interface with an automatic bill payment system 35.For the sake of brevity, conventional data networking, applicationdevelopment and other functional aspects of the systems (and componentsof the individual operating components of the systems) may not bedescribed in detail herein. Furthermore, the connecting lines shown inthe various figures contained herein are intended to represent exemplaryfunctional relationships and/or physical couplings between the variouselements. It should be noted that many alternative or additionalfunctional relationships or physical connections may be present in apractical system.

Moreover, one skilled in the art will appreciate that, for securityreasons, any databases, systems, devices, servers or other components ofthe present invention may consist of any combination thereof at a singlelocation or at multiple locations, wherein each database or systemincludes any of various suitable security features, such as, forexample, firewalls, access codes, encryption, decryption, compression,decompression, and/or the like.

Host 5 may include any hardware and/or software suitably configured tofacilitate management of user income and/or user income sources. Host 5may interface, directly or indirectly, with user account 20, userinterface 25, income sources 30, automatic bill payment system 35,and/or payees 40. Host 5 may acquire information, funds or any otherdata from income sources 30 and transfer the funds into user account 20.Host may also acquire information from payees 40 and/or transfer fundsto payees 40 (e.g., directly or via automatic bill payment system 35).Host may also include debt analyzer 15 and debt database 10. Host 5 mayalso allow the user to track user spending, payments and incomereceived. Host 5 may also allow the user to import such data fromanother system or database (e.g., security broker database, charge carddatabase), for the purpose of helping the user to estimate income, billamounts, the dates when such income will be received or when such billswill come due. Host 5 may also allow user to utilize user interface 25to access not only the features of system 1, but also personal financialaccounting system features and information. In this regard, the systemmay also be integrated with any personal financial or accounting system,such as Quicken or any financial advice software.

Debt database 10 may include any hardware and/or software suitablyconfigured to facilitate storing debt information. The debt informationmay include, for example, payee account numbers, payee names, bill duedates, minimum payment information, penalty information, interestinformation, credit rating information, payee rules and restrictions,and/or the like. Debt analyzer 15 may include any hardware and/orsoftware suitably configured to facilitate analysis of the debtinformation and/or to determine a suggested hierarchy of debts. The debtanalyzer 15 may obtain information from a personal financial oraccounting system in order to provide additional recommendations whichconform at least partially to the suggestions or restrictions of thefinancial or accounting software.

User account 20 may include any hardware and/or software suitablyconfigured to facilitate storing user income and/or user incomeinformation. The user income information may include, for example,income source data, date of deposit or receipt, amounts owed fromparticular income sources, amounts deposited in the user savings account23, dates of deposits in user savings account 23 and/or the like.

User savings account 23 may include any hardware and/or softwaresuitably configured to facilitate storing income, wherein the income maynot have yet been allocated to payees 40. User savings account 23 mayinclude, for example, any financial account (e.g., savings, checking,money market), loyalty account, security, financial transactioninstrument (e.g., stored value card, charge card, smart card,transponder), negotiable instrument, coupon and/or the like. In anexemplary embodiment, the account does not easily allow for withdrawals(i.e., has no check-writing privileges, banking or checking cardfeatures which facilitate easy withdrawals).

User interface 25 may include any hardware and/or software suitablyconfigured to facilitate input, receipt and/or review of any informationrelated to system 1 or any information discussed herein. User interface25 may include any device (e.g., personal computer) which communicates(in any manner discussed herein) with host 5 via any network discussedherein.

Automatic bill payment system 35 may include any hardware and/orsoftware suitably configured to facilitate acquiring bill informationand/or payment of bills. Automatic bill payment system 35 may includeknown bill payment systems such as, for example, the systems offered byYahoo Bill Pay, Checkfree, PayBills, PayPal, etc. Automatic bill paymentsystem 35 may facilitate the payment of bills on or near the due date.Because paying some bills past the due date may substantially affect theuser's credit rating, system 1 may incorporate an on-line bill paymentsystem 35 to mitigate the late payment risk. Accordingly, in oneembodiment, the system includes an automatic bill payment system 35 orother on-line billing feature that allows the user to select bills to bepaid on-line and the date in which the bills are to be paid.

Payees 40 may include one or more person or entity which is owed money.Payees 40 may provide or allow access to debt information from host 5directly or via automatic bill payment system 35. Payee may alsoinclude, for example, one or more person, entity, organization,software, hardware, charity, utility, mortgage company and/or the like.Similarly, user may include, for example, one or more person, entity,company, charity, organization, software, hardware, and/or the like.

The various system components discussed herein may include one or moreof the following: a server or other computing systems including aprocessor for processing digital data; a memory coupled to saidprocessor for storing digital data; an input digitizer coupled to theprocessor for inputting digital data; an application program stored insaid memory and accessible by said processor for directing processing ofdigital data by said processor; a display device coupled to theprocessor and memory for displaying information derived from digitaldata processed by said processor; and a plurality of databases. Variousdatabases used herein may include: user data, debt data, income data,merchant data; financial institution data; and/or like data useful inthe operation of the present invention. As those skilled in the art willappreciate, user computer may include an operating system (e.g., WindowsNT, 95/98/2000, OS2, UNIX, Linux, Solaris, MacOS, etc.) as well asvarious conventional support software and drivers typically associatedwith computers. user computer can be in a home or business environmentwith access to a network. In an exemplary embodiment, access is througha network or the Internet through a commercially-available web-browsersoftware package.

As used herein, the term “network” shall include any electroniccommunications means which incorporates both hardware and softwarecomponents of such. Communication among the parties in accordance withthe present invention may be accomplished through any suitablecommunication channels, such as, for example, a telephone network, anextranet, an intranet, Internet, point of interaction device (point ofsale device, personal digital assistant, cellular phone, kiosk, etc.),online communications, off-line communications, wireless communications,transponder communications, local area network (LAN), wide area network(WAN), networked or linked devices and/or the like. Moreover, althoughthe invention is frequently described herein as being implemented withTCP/IP communications protocols, the invention may also be implementedusing IPX, Appletalk, IP-6, NetBIOS, OSI or any number of existing orfuture protocols. If the network is in the nature of a public network,such as the Internet, it may be advantageous to presume the network tobe insecure and open to eavesdroppers. Specific information related tothe protocols, standards, and application software utilized inconnection with the Internet is generally known to those skilled in theart and, as such, need not be detailed herein. See, for example, DilipNaik, “Internet Standards and Protocols” (1998); “Java 2 Complete”,various authors, (Sybex 1999); Deborah Ray and Eric Ray, “Mastering HTML4.0” (1997); and Loshin, “TCP/IP Clearly Explained” (1997) and DavidGourley and Brian Totty, “HTTP, The Definitive Guide” (2002), thecontents of which are hereby incorporated by reference.

The various system components may be independently, separately orcollectively suitably coupled to the network via data links whichincludes, for example, a connection to an Internet Service Provider(ISP) over the local loop as is typically used in connection withstandard modem communication, cable modem, Dish networks, ISDN, DigitalSubscriber Line (DSL), or various wireless communication methods. See,e.g., Gilbert Held, “Understanding Data Communications” (1996), herebyincorporated by reference. It is noted that the network may beimplemented as other types of networks, such as an interactivetelevision (ITV) network. Moreover, the system contemplates the use,sale or distribution of any goods, services or information over anynetwork having similar functionality described herein.

Any databases discussed herein may be any type of database, such asrelational, hierarchical, graphical, object-oriented, and/or otherdatabase configurations. Common database products that may be used toimplement the databases include DB2 by IBM (White Plains, N.Y.), variousdatabase products available from Oracle Corporation (Redwood Shores,Calif.), Microsoft Access or Microsoft SQL Server by MicrosoftCorporation (Redmond, Wash.), or any other suitable database product.Moreover, the databases may be organized in any suitable manner, forexample, as data tables or lookup tables. Each record may be a singlefile, a series of files, a linked series of data fields or any otherdata structure. Association of certain data may be accomplished throughany desired data association technique such as those known or practicedin the art. For example, the association may be accomplished eithermanually or automatically. Automatic association techniques may include,for example, a database search, a database merge, GREP, AGREP, SQL,and/or the like. The association step may be accomplished by a databasemerge function, for example, using a “key field” in pre-selecteddatabases or data sectors.

More particularly, a “key field” partitions the database according tothe high-level class of objects defined by the key field. For example,certain types of data may be designated as a key field in a plurality ofrelated data tables and the data tables may then be linked on the basisof the type of data in the key field. In this regard, the datacorresponding to the key field in each of the linked data tables ispreferably the same or of the same type. However, data tables havingsimilar, though not identical, data in the key fields may also be linkedby using AGREP, for example. In accordance with one aspect of thepresent invention, any suitable data storage technique may be utilizedto store data without a standard format. Data sets may be stored usingany suitable technique, including, for example, storing individual filesusing an ISO/IEC 7816-4 file structure; implementing a domain whereby adedicated file is selected that exposes one or more elementary filescontaining one or more data sets; using data sets stored in individualfiles using a hierarchical filing system; data sets stored as records ina single file (including compression, SQL accessible, hashed via one ormore keys, numeric, alphabetical by first tuple, etc.); block of binary(BLOB); stored as ungrouped data elements encoded using ISO/IEC 7816-6data elements; stored as ungrouped data elements encoded using ISO/IECAbstract Syntax Notation (ASN.1) as in ISO/IEC 8824 and 8825; and/orother proprietary techniques that may include fractal compressionmethods, image compression methods, etc.

In one exemplary embodiment, the ability to store a wide variety ofinformation in different formats is facilitated by storing theinformation as a Block of Binary (BLOB). Thus, any binary informationcan be stored in a storage space associated with a data set. Asdiscussed above, the binary information may be stored on the financialtransaction instrument or external to but affiliated with the financialtransaction instrument. The BLOB method may store data sets as ungroupeddata elements formatted as a block of binary via a fixed memory offsetusing either fixed storage allocation, circular queue techniques, orbest practices with respect to memory management (e.g., paged memory,least recently used, etc.). By using BLOB methods, the ability to storevarious data sets that have different formats facilitates the storage ofdata associated with the financial transaction instrument by multipleand unrelated owners of the data sets. For example, a first data setwhich may be stored may be provided by a first issuer, a second data setwhich may be stored may be provided by an unrelated second issuer, andyet a third data set which may be stored, may be provided by an thirdissuer unrelated to the first and second issuer. Each of these threeexemplary data sets may contain different information that is storedusing different data storage formats and/or techniques. Further, eachdata set may contain subsets of data which also may be distinct fromother subsets.

As stated above, in various embodiments of the present invention, thedata can be stored without regard to a common format. However, in oneexemplary embodiment of the present invention, the data set (e.g., BLOB)may be annotated in a standard manner when provided for manipulating thedata onto the financial transaction instrument. The annotation maycomprise a short header, trailer, or other appropriate indicator relatedto each data set that is configured to convey information useful inmanaging the various data sets. For example, the annotation may becalled a “condition header”, “header”, “trailer”, or “status”, herein,and may comprise an indication of the status of the data set or mayinclude an identifier correlated to a specific issuer or owner of thedata. In one example, the first three bytes of each data set BLOB may beconfigured or configurable to indicate the status of that particulardata set; e.g., LOADED, INITIALIZED, READY, BLOCKED, REMOVABLE, orDELETED. Subsequent bytes of data may be used to indicate for example,the identity of the issuer, user, transaction/membership accountidentifier or the like. Each of these condition annotations are furtherdiscussed herein.

The data set annotation may also be used for other types of statusinformation as well as various other purposes. For example, the data setannotation may include security information establishing access levels.The access levels may, for example, be configured to permit only certainindividuals, levels of employees, companies, or other entities to accessdata sets, or to permit access to specific data sets based on thetransaction, merchant, issuer, user or the like. Furthermore, thesecurity information may restrict/permit only certain actions such asaccessing, modifying, and/or deleting data sets. In one example, thedata set annotation indicates that only the data set owner or the userare permitted to delete a data set, various identified merchants arepermitted to access the data set for reading, and others are altogetherexcluded from accessing the data set. However, other access restrictionparameters may also be used allowing various entities to access a dataset with various permission levels as appropriate.

The data, including the header or trailer may be received by a standalone interaction device configured to add, delete, modify, or augmentthe data in accordance with the header or trailer. As such, in oneembodiment, the header or trailer is not stored on the transactiondevice along with the associated issuer-owned data but instead theappropriate action may be taken by providing to the transactioninstrument user at the stand alone device, the appropriate option forthe action to be taken. The present invention may contemplate a datastorage arrangement wherein the header or trailer, or header or trailerhistory, of the data is stored on the transaction instrument in relationto the appropriate data.

The computers discussed herein may provide a suitable website or otherInternet-based graphical user interface which is accessible by users,hosts or operators of the system. In one embodiment, the MicrosoftInternet Information Server (IIS), Microsoft Transaction Server (MTS),and Microsoft SQL Server, are used in conjunction with the Microsoftoperating system, Microsoft NT web server software, a Microsoft SQLServer database system, and a Microsoft Commerce Server. Additionally,components such as Access or Microsoft SQL Server, Oracle, Sybase,Informix MySQL, Intervase, etc., may be used to provide an Active DataObject (ADO) compliant database management system.

Any of the communications, inputs, storage, databases or displaysdiscussed herein may be facilitated through a website having web pages.The term “web page” as it is used herein is not meant to limit the typeof documents and applications that might be used to interact with theuser. For example, a typical website might include, in addition tostandard HTML documents, various forms, Java applets, JavaScript, activeserver pages (ASP), common gateway interface scripts (CGI), extensiblemarkup language (XML), dynamic HTML, cascading style sheets (CSS),helper applications, plug-ins, and the like. A server may include a webservice which receives a request from a web server, the requestincluding a URL (http://yahoo.com/stockquotes/ge) and an IP address(123.56.789). The web server retrieves the appropriate web pages andsends the data or applications for the web pages to the IP address. Webservices are applications which are capable of interacting with otherapplications over a communications means, such as the internet. Webservices are typically based on standards or protocols such as XML,SOAP, WSDL and UDDI. Web services methods are well known in the art, andare covered in many standard texts. See, e.g., Alex Nghiem, “IT WebServices: A Roadmap for the Enterprise” (2003), hereby incorporatedherein by reference.

The present invention may be described herein in terms of functionalblock components, screen shots, optional selections and variousprocessing steps. It should be appreciated that such functional blocksmay be realized by any number of hardware and/or software componentsconfigured to perform the specified functions. For example, the presentinvention may employ various integrated circuit components, e.g., memoryelements, processing elements, logic elements, look-up tables, and thelike, which may carry out a variety of functions under the control ofone or more microprocessors or other control devices. Similarly, thesoftware elements of the present invention may be implemented with anyprogramming or scripting language such as C, C++, Java, COBOL,assembler, PERL, Visual Basic, SQL Stored Procedures, extensible markuplanguage (XML), with the various algorithms being implemented with anycombination of data structures, objects, processes, routines or otherprogramming elements. Further, it should be noted that the presentinvention may employ any number of conventional techniques for datatransmission, signaling, data processing, network control, and the like.Still further, the invention could be used to detect or prevent securityissues with a client-side scripting language, such as JavaScript,VBScript or the like. For a basic introduction of cryptography andnetwork security, the following may be helpful references: (1) “AppliedCryptography: Protocols, Algorithms, And Source Code In C,” by BruceSchneier, published by John Wiley & Sons (second edition, 1996); (2)“Java Cryptography,” by Jonathan Knudson, published by O'Reilly &Associates (1998); (3) “Cryptography & Network Security: Principles &Practice,” by William Stalling, published by Prentice Hall; all of whichare hereby incorporated by reference.

Each user, income source, host, payee or other participant is equippedwith a computing device in order to interact with the system andfacilitate online commerce transactions. The customer has a computingunit in the form of a personal computer, although other types ofcomputing units may be used including laptops, notebooks, hand heldcomputers, set-top boxes, cellular telephones, touch-tone telephones andthe like. The merchant has a computing unit implemented in the form of acomputer-server, although other implementations are contemplated by theinvention. The bank has a computing center shown as a main framecomputer. However, the bank computing center may be implemented in otherforms, such as a mini-computer, a PC server, a network of computerslocated in the same of different geographic locations, or the like.Moreover, the system contemplates the use, sale or distribution of anygoods, services or information over any network having similarfunctionality described herein.

The computers may be interconnected via a second network, referred to asa payment network. The payment network which may be part of certaintransactions represents existing proprietary networks that presentlyaccommodate transactions for credit cards, debit cards, and other typesof financial/banking cards. The payment network is a closed network thatis assumed to be secure from eavesdroppers. Exemplary transactionnetworks may include the American Express®, VisaNet® and the Veriphone®networks.

An “account” or “account number”, as used herein, may include anydevice, code, number, letter, symbol, digital certificate, smart chip,digital signal, analog signal, biometric or other identifier/indiciasuitably configured to allow the user to access, interact with orcommunicate with the system such as, for example, one or more of anauthorization/access code, personal identification number (PIN),Internet code, other identification code, and/or the like which mayoptionally be located on or associated with a rewards card, charge card,credit card, debit card, pre-paid card, telephone card, smart card,magnetic stripe card, bar code card, transponder, radio frequency cardor an associated account. The account number may be distributed andstored in any form of plastic, electronic, magnetic, radio frequency,wireless, audio and/or optical device capable of transmitting ordownloading data from itself to a second device. A customer accountnumber may be, for example, a sixteen-digit credit card number, althougheach credit provider has its own numbering system, such as thefifteen-digit numbering system used by American Express. Each company'scredit card numbers comply with that company's standardized format suchthat the company using a sixteen-digit format will generally use fourspaced sets of numbers, as represented by the number “0000 0000 00000000”. The first five to seven digits are reserved for processingpurposes and identify the issuing bank, card type, etc. In this example,the last (sixteenth) digit is used as a sum check for the sixteen-digitnumber. The intermediary eight-to-ten digits` are used to uniquelyidentify the customer. A merchant account number may be, for example,any number or alpha-numeric characters that identifies a particularmerchant for purposes of card acceptance, account reconciliation,reporting, or the like.

The invention is described herein with reference to screen shots, blockdiagrams and flowchart illustrations of methods, apparatus (e.g.,systems), and computer program products according to various aspects ofthe invention. It will be understood that each functional block of theblock diagrams and the flowchart illustrations, and combinations offunctional blocks in the block diagrams and flowchart illustrations,respectively, can be implemented by computer program instructions. Thesecomputer program instructions may be loaded onto a general purposecomputer, special purpose computer, or other programmable dataprocessing apparatus to produce a machine, such that the instructionswhich execute on the computer or other programmable data processingapparatus create means for implementing the functions specified in theflowchart block or blocks.

These computer program instructions may also be stored in acomputer-readable memory that can direct a computer or otherprogrammable data processing apparatus to function in a particularmanner, such that the instructions stored in the computer-readablememory produce an article of manufacture including instruction meanswhich implement the function specified in the flowchart block or blocks.The computer program instructions may also be loaded onto a computer orother programmable data processing apparatus to cause a series ofoperational steps to be performed on the computer or other programmableapparatus to produce a computer-implemented process such that theinstructions which execute on the computer or other programmableapparatus provide steps for implementing the functions specified in theflowchart block or blocks.

Accordingly, functional blocks of the block diagrams and flowchartillustrations support combinations of means for performing the specifiedfunctions, combinations of steps for performing the specified functions,and program instruction means for performing the specified functions. Itwill also be understood that each functional block of the block diagramsand flowchart illustrations, and combinations of functional blocks inthe block diagrams and flowchart illustrations, can be implemented byeither special purpose hardware-based computer systems which perform thespecified functions or steps, or suitable combinations of specialpurpose hardware and computer instructions.

In one embodiment, the foregoing exemplary system may be used in thepresent invention to perform the following method. The exemplary methodmay include, as set forth in FIG. 2, a registration phase (step 200), arecommendation phase (step 205), a goal establishment phase (step 210),an overdraw analysis phase (step 215) and a payment phase (step 220).

The registration phase (step 200) may include a user providing andsystem receiving financial information. The user may provide theinformation via any network or communication system discussed herein. Inone embodiment, host 5 provides a web page within a website which ishosted at a server, wherein the webpage facilitates obtaining personalfinancial information from the user by, for example, menu driveninteractive procedures. The user may use user interface 25 to enter intoa web page the requested financial information, wherein the financialinformation may include, for example, user income information, userincome source information, user goal information, and user debtinformation.

The user income source information may include any information relatedto user income such as, for example, income source demographic data,income source routing data (e.g., to facilitate the funds beingdeposited within user account 20), amount of income during a particulartimeframe (e.g., bi-monthly), bonus information (e.g., amount and timeof year received), tax refund information, estimated commissioninformation and/or the like. As set forth above, the user income mayinclude any monetary or non-monetary income, asset or benefit related tothe user, wherein the income may be obtained from an income source ofthe user (e.g., employer) or any other third party. The user income mayinclude paycheck, salary, bonuses, commissions, purchase rebate, taxrebates, property, goods, social security, welfare, alimony, childsupport, rental income, securities-related income, gambling winnings,credits, loyalty points, reward points, coupons and/or the like. Theuser may also be requested to identify the days of the month in whichsuch user income is received and the amounts of such income. If the userreceives any or all income at random times (i.e. “not periodically”),then the user may estimate the amounts of such non-periodic income andindicate when such non-periodic income will be received. Host 5 maystore the user income and user income source information in user accountdatabase 20.

The user income may also include additional funds submitted by the useror any other third party to system 1 in order to supplement user account20 or user savings account 23. For example, the user may submit extrafunds with a bill payment such as a single check or money transfer forboth host charge card purchases and for deposit of money into usersavings account 23. When the user payment is received by the host orcharge card administrator, the payment processing system determines,based on the user goals, how each of the user's payments should beallocated between charge card payments and user savings account 23,namely through the use of a payment hierarchy which includes apredetermined set of allocation rules. The host or charge cardadministrator's payment processing system may then electronicallyforward the appropriate savings amount to user saving account 23 basedupon another payment hierarchy related to the allocation of savingsfunds among savings, debts or investment products. For additionalinformation related to submitting additional funds to the system, seefor example, U.S. Ser. No. 09/415,632 filed on Oct. 12, 1999, byinventors Crane, et al., and entitled “SYSTEM AND METHOD FOR DIVIDING AREMITTANCE AND DISTRIBUTING A PORTION OF THE FUNDS TO MULTIPLEINVESTMENT PRODUCTS,” which is hereby incorporated by reference.

The user goal information may include the amounts the user desires topay himself, any other financial amount, limit, milestone, threshold,objective, aspiration and/or the like. For example, an amount of moneyneeded for a vacation, a major purchase (e.g., house or car), holidaygifts, education, or retirement. The amount may be a one-time totalamount, a pre-established amount for a limited time period or continuingtime period, or a periodic amount which may result in a total savings bya certain date (e.g., $10,000 by Jun. 15 of the following year for hisdaughter's wedding). The goal may also include a common goal for a groupof people such as, for example, a group vacation, annual familyfunction, charitable event or fundraiser and/or the like. The user goalmay be entered by the user, randomly generated, based on a increasing ordecreasing amount, created using a formula, selected by system 1 and/orselected by a third party (e.g., parent, financial advisor, etc). Thesystem 1 may store the user goal information in user account database20. The user may use the goal information for his own savings activitiesor the user may be provided the option to set up user savings account23, wherein the system allocates a portion of the user income to usersavings account 23. Because many individuals often think of saving moneybased on how much they will have after paying bills, the inventionattempts to overcome this attitude, in an exemplary embodiment, byprompting the user for the user goal information before entering userdebt information, so that the user is aggressive in the effort to payhimself first. Similarly, the user is prompted to enter the user goalinformation before entering income amounts, so that the user will beaggressive in setting the user goal information.

The user debt information includes any information related to user debtssuch as, for example, bills, name and address of payees 40, payeeaccount routing information, amount of bills, minimum amounts due, duedate, periodic payment plan information and/or the like. As set forthabove, user debts may include any monetary or non-monetary liability ofthe user or any other third party. The debts may be related to bills,car payments, loans, mortgages, purchases, voluntary payments, alimony,child support, payment plans, lines of credit, financial losses,gambling losses, responsibilities and/or the like. The user debts mayalso include any amount that the user regularly pays as part of hisliving expenses and any other amounts that the user pays from time totime, or expects to pay. Host 5 may store the user debt information indebt database 10. Some bills of course are paid on a regular, periodicbasis (monthly) and have predetermined amounts (e.g. a monthly autopayment of $300; a quarterly insurance payment of $200.00). Other billsarrive more randomly and/or in non-fixed amounts, but the bills may beanticipated with reasonable accuracy (e.g. health expenses, taxpayments, auto and home maintenance, or unexpected events). For bothperiodic and non-periodic bills, the user may enter the day, the monthand the due date which is the day he expects such bills to become due.The due date should not to be confused with the date the bill isreceived, because the due date represents the last possible day forbills to be paid.

The recommendation phase (step 205) may include, in one embodiment, debtanalyzer 15 of system 1 reviewing the user debt information in debtdatabase 10 to provide recommendations related to the prioritization orhierarchy for paying certain bills, the amount to pay for each bill andthe user goal based upon, for example, user goal information, user debtinformation (e.g., minimum amounts due, due dates) and available userincome. An exemplary embodiment includes periodic income (e.g.,employment income) because it is often the easiest to base savings goalsupon periodic income. For example, if the user is paid (afterdeductions) $500.00 a week from an employer, then the system 1 maysuggest that the user pay himself some portion of that $500.00 (e.g.,$100.00) before paying any bills. In another embodiment, the system mayalso incorporate randomly received income (e.g., a user may pay first tohimself 10% of any tax refund or other non-routine income).

In addition to savings suggestions, the system may provide the user withrecommendations for prioritizing payment of bills so that the user maydetermine when and how much to pay himself. For example, the system mayrecommend prioritizing bills to be paid in the following order fromhighest priority to lowest priority: (i) Bills that are for essentials(e.g., food, transportation to work and school, necessary job-relatedexpenditures, necessary education-related expenditures); (ii) Bills thataffect credit rating the most; (iii) Bills that have high penalties forlate payments; and, (iv) Bills that are for non-essentials. The systemmay also provide recommendations for partial payments of bills, wherethe recommendations are directly related to helping the user meet theuser goal. For example, if a user has an income of $500.00, and the userwants to save $400.00, but the user has a credit card bill with aminimum due of $50.00 and a total balance of $500.00, the program mayrecommend that the user submits a payment that allows the user to meethis user goal, while avoiding a large penalty (e.g., do not pay lessthan the minimum due, but not any larger amount).

In further embodiments, the system 1 may allow the user to select apassive “recommendation” mode or an active “automatic mode”. In thepassive recommendation mode, the debt analyzer 15 providesrecommendations to the user such as, for example, the amounts to payhimself, when the payments to the user savings account 23 will be made,the order in which bills should be paid and the amounts to be paidtoward the bills. In the automatic mode, the debt analyzer 15 providesrecommendations to the user initially, but upon the user accepting orrevising the recommendations, the system 1 automatically transfers thepayment to the user savings account 23 and to the payment of bills. Apartial automatic mode may also allow the user to choose actions to takeplace automatically, while other actions may require approval by theuser after a recommendation is made by the program. For example, in thepartial automatic mode, the user may allow the program to automaticallydirect a payment to the user savings account 23, while requiring thesystem to provide a recommendation and waiting for user approval beforepaying certain bills.

In another embodiment, the debt analyzer 15 may recommend that the userpay himself first, but only after funds become available in user account20. In another embodiment, the system, on a certain date and/or upon acertain level of user income being transferred to user account 20,automatically transfers a payment from user account 20 to the usersavings account 23. The system may also allow the user to set his ownpayment criteria (in addition to pre-established options) or overridethe order in which debt analyzer recommends that certain bills are to bepaid. For example, the system may determine that bills for essentials(e.g., transportation) are given priority over bills that affect creditrating. The user, however, may determine that bills that affect hiscredit rating are more important than bills for transportation to work.If the user determines that he can walk to work instead of driving orusing a mass mode of transportation, then the user may choose to providebills that affect credit rating priority over such transportation bills.Thus, the system, based upon the user's criteria or override, mayrecommend paying bills in an order that gives priority to bills thataffect credit rating over transportation bills. The system may also“learn” the user's preferences over time by analyzing the user's inputsand override suggestions such that debt analyzer 15 may providerecommendations that more appropriately conform to more common userinputs and override requests.

In another embodiment, system 1 may help the user determine if a goal ispossible or realistic within a particular timeframe. For example, if theuser wants to save $10,000 in one year to obtain a new car, the system(possibly in conjunction with financial management software) may analyzethe user's income sources 30 and provide the recommendation that theuser should change the goal completion date to two years or the usershould obtain additional income sources. In this manner, the user ismore likely to reach certain goals and continue to utilize system 1.Similarly, the system may help the user not only set current goals, butalso to determine future goal amounts. For example, a user may set agoal during the current year to buy a new sports car, but in futureyears, the user's child may need to attend college or get married, sothe user's savings goal may need to increase. As such, system 1 maycalculate the amount of savings needed over various years to meet thecurrent and future goals, wherein the savings may be calculated as anequal amount over the years or the savings may be calculated as anincreasing amount to correspond to projected increased income over theyears.

In an exemplary embodiment, the system may also provide probabilitymodeling which facilitates financial advising and planning. A portfoliointegration module may facilitate integration of at least one of auser's goals, assets, savings, and risk tolerance in analyzing anddeveloping a customized strategy for financial planning of the user. Aportfolio reconciler module may communicate with the portfoliointegration module to facilitate comparison of the customized strategyto other strategies and projected financial decisions in order tofurther facilitate the user meeting the user goals. A stochasticmodeling module in communication with the portfolio integration moduleand the portfolio reconciler module may use data from the portfoliointegration module and/or the portfolio reconciler module in astochastic modeling analysis to facilitate creation of a proposedsituation portfolio for the user. The stochastic modeling module may usea synchronous stationary bootstrap method of statistical sampling tofacilitate analysis of historical economic data in order to facilitatecreation of the proposed situation portfolio. A simulator module incommunication with the portfolio integration module and the stochasticmodeling module may forecast the effects of changes to the probabilitymodeling system and to monitor and test the system over a predeterminedamount of time. For additional information related to financialmanagement systems and methods, see for example, U.S. Pat. No.5,819,263, issued on Oct. 6, 1998, by inventors Bromley, et al., andentitled “FINANCIAL PLANNING SYSTEM INCORPORATING RELATIONSHIP AND GROUPMANAGEMENT”; U.S. Pat. No. 6,430,542, issued on Aug. 6, 2002, andentitled “COMPUTER-IMPLEMENTED PROGRAM FOR FINANCIAL PLANNING AND ADVISESYSTEM”; U.S. Ser. No. 10/210,827 entitled “SYSTEM AND METHOD FORFINANCIAL PLANNING AND ADVICE,” which was filed on Jul. 31, 2002; and,U.S. Ser. No. 09/712,743, entitled “SYSTEM AND METHOD FOR CREATINGFINANCIAL ADVISE APPLICATIONS,” filed Nov. 14, 2000, all of which arehereby incorporated by reference.

The goal establishment phase (step 210) may include the system and/orthe user determining a payment hierarchy which may include transferringfunds to the user's savings account 23 prior to paying all or a portionof certain bills. In this regard, the user determines “when” to payhimself based on the suggested recommendations and ranking. Using theexample hierarchy above, one user may choose to transfer funds to usersavings account 23 after paying bills that affect credit rating, butbefore bills with high penalties for late payment. However, another usermay receive a similar recommended hierarchy list and request that thesystem transfer funds to user savings account 23 before paying bills inany of the categories set forth in the hierarchy listing.

The system may also not only pay (or encourage the user to pay) the userfirst (or in a priority position), but the system may transfer funds tothe user savings account 23 first in the largest amounts possible. Forexample, if the user receives an electric bill on the fifteenth of themonth that is not due until the first of the next month, the system mayprompt the user for the due date and the system may recommend that theuser to pay the bill on the due date and not before the due date.Additionally, if the user gets paid on the fifteenth of the month, thesystem recommends that the user pay himself first, leaving enough moneyto pay bills later, including the electric bill that is due on the firstof the month. After the user pays himself, he can also budgetdiscretionary money for entertainment purposes, dining out, etc. Aresponsible user is not likely to exceed his budget for discretionarymoney when he knows that bills are due that must be paid. Moreover, ifthe user exceeds the discretionary amount and cannot pay bills, then theuser has already at least paid the most important entity first, namelyhimself.

In order for the user to meet a particular savings goal while the usercontinues to spend money, the system may be configured to transfer acertain amount of any user transaction amount to user savings account23. In one embodiment, the user or system may set a particular dollaramount, percentage of purchase amount, number of transactions, totaldollar amount spent or any other portion which is calculated based uponuser transactions or the transaction amounts. For example, the systemmay obtain data from the user's transaction instrument account such thatevery time the user purchases an item which costs over $100, the systemmay transfer $5 of the user's income from user account 20 to the usersavings account 23. In another example, the system may transfer 5% ofthe total value of all purchases during the next five months to usersavings account 23. In these embodiments, the more a user spends onpurchases, the more the user may save. Similarly, the system may analyzeloyalty point accumulation and transfer loyalty points to a savingsaccount based upon a pre-determined formula.

With respect to loyalty points, the system may incorporate loyaltypoints into any part of the process and provide the loyalty points toone or more participants in the process (e.g., user, payee, incomesource). As used herein, loyalty points may include any incentive whichmay or may not include points such as, for example, coupons, rewards,preferential services, preferential rates, prizes, vacations,entertainment packages and/or the like. In one embodiment, the systemmay provide loyalty points for every dollar that the user saves insavings account 23. The system may also encourage savings and discouragefull payment of bills by providing loyalty points for not paying thefull amount of a bill. The system may also provide a larger amount ofloyalty points upon reaching a goal or upon reaching certain milestonestoward the goal. The system may also provide extra loyalty points if theuser allows the system to automatically transfer funds to savingsaccount 23 without the user's prior approval. If user is utilizing thesavings account to save money for a future gift or to provide a futuredonation to a charity, the system may allow the user to use loyaltypoints to pay for any portion of the gift or to supplement thecharitable donation. The system may also acquire information related touser loyalty points (e.g., from system 1 (wherein the points were earnedin system 1) or from a third party loyalty system), convert the loyaltypoints to a currency value and apply the currency value to user savingsaccount 23 or payees 40 (e.g., user debts).

In still another embodiment, a government entity, an affiliate orsponsoring entity may provide loyalty points, preferred rates or rewardsfor increased savings. For example, user savings account 23 may bemaintained at a bank such that the bank may desire to also encourageincreased savings. In this regard, the bank may provide the user withloyalty points, higher interest rates, or prizes based upon the numberof transfers or dollar amount of each transfer to the user savingsaccount 23, the total amount in user savings account 23 during a certaintime period and/or the like. For additional information related toloyalty systems, see for example, U.S. Ser. No. 10/010,947 entitled“SYSTEM AND METHOD FOR NETWORKED LOYALTY PROGRAM,” which was filed onNov. 6, 2001, and U.S. Ser. No. 09/834,478 entitled “A SYSTEM AND METHODFOR USING LOYALTY POINTS,” which was filed on Apr. 13, 2001, which arehereby incorporated by reference.

While the present invention may be described as transferring funds touser savings account 23 first before other user debts, the inventionalso contemplates transferring funds to the user savings account 23 atany predetermined time, interval or random period and the invention alsocontemplates transferring funds to the user savings account 23 before,during or after paying certain debts. For example, the system may allowthe user to identify bills that are to be paid before the systemtransfers funds to the user savings account 23 and to identify bills topaid after the system transfers funds to the user savings account 23.The invention may also include exceptions to self payment first whichmay be determined by the user, a government entity or any other entityor person. The exceptions may include, for example, child support mustalways be paid first, then the user may decide on other “first” paymentoptions. The invention may also allow the user to identify a priorityfor bills to be paid and/or any predetermined amount or percentage ofeach bill to pay.

During the overdraw analysis phase (step 215), prior to transferring theuser income, host 5 may analyze the balance of funds in the user account20 to determine if sufficient funds exist for paying the user savingsaccount 23 and the bills according to the selected payment hierarchy. Inone embodiment, because bills may vary from month to month, as the userenters bills to be paid, the program (e.g., in real-time) automaticallyperforms a calculation to determine if the bills can be paid withoutoverdrawing or exceeding the balance in the user account 20. Ifinsufficient funds exist, system 1 may notify the user to readjust thepayment hierarchy or the system may automatically adjust the paymenthierarchy based upon pre-established rules. The system may notify theuser of any overdraw issues via any communication system or networkdiscussed herein.

During payment phase (step 220), if sufficient funds exist, system 1transfers a predetermined amount of funds from user account 20 to usersavings account 23, then to payees 40. In one embodiment, host 5 maytransfer funds and/or payee information to automatic bill payment system35 such that automatic bill payment system 35 allocates funds pursuantto pre-existing rules or auto bill pay procedures. Host 5 may provideinstructions to automatic bill payment system 35 in such a way thatautomatic bill payment system 35 allocates consumer income to payees 40according to the established hierarchy. For example, host 5 may provideautomatic bill payment system 35 with the approval for payment of a billfor a necessity, then host 5 may wait until user savings account 23reaches a pre-established level before providing another paymentinstruction to automatic bill payment system 35. In another embodiment,automatic bill payment system 35 may accept hierarchy or otherinstructions from system 1 and automatically allocate payments accordingto the hierarchy.

Transferring funds, or any similar phrase used herein, may includetransferring all or any portion of funds, directly or indirectly, in anymanner (e.g., electronic transfer, wire, etc). In one embodiment, the“transfer” may include, for example, encouraging the user to transferfunds, encouraging the user to select a particular transfer of funds bythe system, providing a negotiable instrument (e.g., check) to the user(or to a selected person or entity), transferring funds to a charity orother entity (or dividing the funds between multiple charities),withdrawing funds from one account and depositing funds in anotheraccount, providing cash, transferring funds to any financial instrumentdiscussed herein or known in the art (e.g., account, account number,stored value card, gift card, charge card credit, etc), sending thefinancial instrument to the user at predetermined intervals (e.g.,monthly or when the account reaches a pre-determined amount), placingthe selected funds in a pooled account with other family members (e.g.,to save for a home improvement project), placing the selected funds in apooled account with other friends (e.g., to save for a group vacation),and/or the like. The invention contemplates automatically receiving userincome from income sources 30, automatically transferring funds to userand/or user savings account 23 and automatically transferring funds topayees 40; however, the invention also contemplates providingrecommendations to user and allowing the user to obtain information,send information, or transfer the user's own funds manually or via athird party system.

The funds may be transferred periodically to user savings account 23,and in an exemplary embodiment, the user income may be periodicallydonated to a charity. For more information and details related toperiodic transfers, donation systems and methods, see for example, U.S.Ser. No. 10/707,715, filed on Jan. 6, 2004, by inventors Aviles, et al.,and entitled “Donation System and Method”, which is hereby incorporatedby reference.

In another embodiment, a stored value or gift card may be used to assistin the budgeting process and to meet the user goal. For example, theuser may obtain an American Express Travel Funds Card that isautomatically loaded by the system with the funds that user needs to paybills. In an exemplary embodiment, the funds desired to meet the user'sgoal are first sent to a user savings account 23. After the user “payshimself” and the system receives the funds in the user savings account23, the system may then take steps (or allow the user to take steps) toload or re-load the stored value card (i.e. the TravelFunds card).

Benefits, other advantages, and solutions to problems have beendescribed herein with regard to specific embodiments. However, thebenefits, advantages, solutions to problems, and any element(s) that maycause any benefit, advantage, or solution to occur or become morepronounced are not to be construed as critical, required, or essentialfeatures or elements of any or all the claims or the invention. Further,no element described herein is required for the practice of theinvention unless expressly described as “essential” or “critical”.

1. A method of incorporating a savings system with an automatic billpayment system, said method including: receiving user financialinformation, wherein said financial information includes at least one ofuser income information related to user income, user income sourceinformation related to user income sources, user debt informationrelated to user debts to payees and user goal information related touser goals; providing a recommendation, wherein said recommendationincludes suggestions for minimizing user debt payments and maximizinguser savings; establishing a payment hierarchy, based at least in parton said recommendation, wherein said payment hierarchy includes at leasta portion of said user income allocated to said user savings account anda portion of said user income allocated to said user debts; and,transferring at least a portion of said user income to a user savingsaccount based on said payment hierarchy; and, transferring instructionsrelated to payment of said user debts to said automatic bill paymentsystem.
 2. The method of claim 1, wherein said transferring stepincludes transferring payment hierarchy instructions including at leastone of providing payee information, user information, and payment amountinformation.
 3. The method of claim 1 further including causinggeneration of an electronic funds transfer message causing a transfer offunds from a user account to a payee account.
 4. The method of claim 1,wherein said transferring step includes transferring at least a portionof said user income and payment hierarchy information to an automaticbill payment system.
 5. The method of claim 1, wherein said transferringstep includes transferring at least a portion of said user income andselected payee information to an automatic bill payment system.
 6. Themethod of claim 1, wherein said transferring step includes transferringat least a portion of said user income and payment hierarchy informationto an automatic bill payment system, and allowing said user to at leastone of select bills to be paid and to select a date for a bill to bepaid.